Cyprus, IMF Reach Deal

4/3/2013 10:54AM

Cyprus and the International Monetary Fund reached an agreement for a €1 billion ($1.28 billion) lifeline on top of the €9 billion bailout the island will get from its euro-zone peers. Charles Forelle reports.

This transcript has been automatically generated and may not be 100% accurate.

... I ... a ... you are looking at some footage coming Cyprus child in the last twenty four hours ... last night Cyprus time of the protests ... and the village deatails emerges Cyprus goes through ... then the market ... it's ... the Cyprus ... look to the crisis about the bailout is over but now we're learning what the bailout really means ... what is going to mean for Cyprus over the next several years ... as they try to meet the terms of the bailout ... can they do it that's the big questions happen a lot of that country that had a lot of trouble with it ... sells for Ellis to the fullest in on the de tails and talk but so those bigger issues ... Charles could see you again ... they will make this a Coelho ... it always happens ... I can give us the deal were not in the de tails of the Cyprus bailout tell us exactly what's new ... okay so the first thing needed it's important to to reckon is the IMF has signed on to the deal as a sign that to contribute one billion year as that of the ten billion total that the EU the IMF reflecting together ... this is this an important thing for the European Union which has tried to do these ... bailouts the basics and possible side by side of the IMF that he's the EU ... a bunch of credibility I aam and the ... service to absorb some of that ... the below ... that of popular an ... upset in anger at the bailout programs and from the D tells that we know from the ins disclosures today that what ... is in the daytime program ... aam there is likely to be a lot of anger they're asking for as they did increase quite substantial reductions in public spending ... deepest Geraghty over a number of years ... I'd to to try to rectify services public finances in addition to the massive problem with its banks that talked about alot ... Cyprus doesn't Everett finance from the nice be addressed ... and did DUI in a recipe for that his austerity and it'll be applied here ... the story and now that it's tedious and Alkman ... gratis wrote the story than a dozen great McKinnon in great ... great work in Cyprus ... and you look at these terms ... they don't sound good but again the way they write it all by bike twenty eighteen or so Cyprus all of ... our Positive isn't good ... we seen this with a number of these countries with these trends are for ... but that did the that outlook down the road is very chipper ... and then we find out that the terms were were on realistically we know ... we have seen this movie before particular Greece the IMF and EU had to revise their ... GDP forecasts ... repeatedly as the austerity the incident ... had the government's ability to raise taxes more than they had expected ... on and that's just a ... fact of life the IMF as I think trying to ... compensate for some of the past errors and as fair use of forecasting ... but it is very clear at this point that one thing that is un clear is the path of Cypress's economy going forward nobody really knows how to model ... had the effect of the shutdown of the island's banking system ... of duty in a fourteen day freeze on bank accounts of the giant haircut on depositors ... it's extremely ditto the plug all this inspiration say Cypress's GDP will be X or Y in two thousand eighteen so ... I'm you know there's a lot of ... the assumptions in here and the problem is it Cyprus doesn't meet those assumptions is going to be even more ... so I mean how soon is it going to be a former revisiting this issue ... how soon before ... we have to hear about this to the tothe deal we did talk to Billy for second at telecom luckily for second ... t given what's going on in Italy right now ... what you know in in in only Izzy and I my cyber see Italy's major problem is a political problem on and there's a lot of hunting and ... figuring out how to form a coalition had a form of government ... I'm that any implement the sorts of reforms that the European Commission and ... that and the IMF about this arrest in Italy Leap was not in the bailout program ... aam but one of the things that ... has in effect that the leaflet intent to Italy ... in the degree to relative degrees of international markets has been ... at the government didn't diamante the then Prime Minister and he has been ... it ... has been doing to try to put in place a mistrust reforms Italy needs of its economy and the problem is in Italy how to form a government ... on the can carry on